LISTEN: Post-Brexit austerity would make the last financial crisis look like a “walk in the park”

June 16, 2016

Not even the dismal weather could dampen spirits as the capital’s business leaders came together for our annual London Business Lunch, this year held in the grounds of Westminster Abbey, and kindly hosted by EY.

After networking over drinks and lunch, attendees heard from keynote speaker, Lord Mandelson, former European Commissioner for Trade and Secretary of State for Business.

Despite confessing to being an “adopted Northerner…that cares most not just about the success of our economy, but the rebalancing of it”, Lord Mandelson recognised that “we won’t have any success or growing economy across our entire country unless our capital city continues to thrive” and that “London First is not a phrase or a slogan or a brand; it’s a fact”.

He outlined the key decisions required to keep London at the top of its economic game for the long-term:

Airports

Lord Mandelson said that “the long overdue decision on airports expansion” would be “heavily Brexit contingent…a vote to leave and the ensuing Tory leadership contest would almost ensure a decision on Gatwick and Heathrow would be kicked further down the road”. In the meantime, however, he said “permission to press ahead with City airport strikes me as a no brainer on economic grounds”.

Housing

Calling housing “London’s defining public policy challenge”, Lord Mandelson emphasised that it is no longer just a social issue, but also an economic one. Reiterating that the capital needs to at least double its rate of annual housebuilding to keep pace with growth, he encouraged those who could to “throw the kitchen sink at London’s housing challenge, and not search wistfully for some ‘silver bullet’ solution”.

Europe

Laying out the case for a “Remain” vote in the referendum on the UK’s membership of the European Union, Lord Mandelson said “the EU has a record of opening up markets to greater competition” and that “the Single Market in Europe has intensified competitive pressure, the main driver of our productivity, growth and expansion in job creation”.

He warned that “the future of this great global city hangs by a thread; if Britain votes to leave Europe, a lot of Europe will have to leave London” and that “there is no alternative relationship with Europe that would give us so much and cost us so little…it won’t be more freedom that we gain if we leave, it will be less control over our economic lives”.

While recognising that we will still be able to trade with Europe – the terms for which may take two to seven years to reach an agreement on – he argued that “year-on-year post-Brexit austerity would make the last financial crisis look like a walk in the park”.

Next year’s London Business Lunch will take place in June 2017, further details will be announced shortly. For sponsorship and table booking enquiries, please contact Beena Chester bchester@londonfirst.co.uk